Gold prices might more than double in 2023 to reach $4,000 per ounce, according to one analyst’s prediction.
This means the precious metal could be the best way to defend against the ever-growing inflation on the watch of President Joe “Multiple Crises” Biden.
Gold Price Spike or Modest Improvement
With Bidenflation still mercilessly pummeling American households, more and more Americans have been looking for an inflation hedge. Gold has been maintaining a relatively steady price, hovering slightly above $1,800 per ounce in recent months.
Yet, it could potentially become an even more valued investment. It could prove to be a haven from the growing economic uncertainty also fueled by recession fears, volatile markets, and the Fed’s interest rate hikes.
One analyst believes that will be the case, with gold prices spiking to the range of $2,500 – $4,000 per ounce. Such a development could occur “sometime next year,” according to Juerg Kiener, the managing director and CIO of Swiss Asia Capital.
Kiener told the CNBC program Street Signs Asia that he believed the gold market would experience a “major move” and one that wouldn’t be limited to only 10%-20%. Instead, he thinks the gold market would see “really new highs.”
The analyst argued that many countries may see a “little bit of a recession” in the first trimester of 2023. That could cause central banks to slow down interest rate increases, immediately making gold more attractive to investors.
Kiener also emphasized that gold was the only asset owned by every single central bank in the world.
He pointed out that gold’s average return on investment had been 8%-10% since the 2000s in any currency. No such levels of returns have been registered in the equity or bond markets.
The Chief Investment Officer of Swiss Asia Capital praised gold as a “very good inflation hedge” and also a “great stagflation catch.”
Gold price has the potential to hit $3,000 or $4,000 an ounce in 2023 https://t.co/PUSs7QJsUZ #gold #price
— TrilliumGold (@trillium_gold) December 22, 2022
Contractions in global gold production had a significant impact on fueling e prior gold cycles. Today,it has been fallg since ‘19 & is likely in e early stage of a new secular downtrend.
Wil history repeat for gold price gg forward?
Gold US$3K is coming!Silver US$50 is coming! pic.twitter.com/CPolQqjQyf
— Derick Tan 🇸🇬 (@tanderick) December 22, 2022
Gold Shifting from West to Asia
Some 400 metric tons of gold were bought by central banks worldwide in the third quarter of 2022, according to data from the World Gold Council. The number is nearly double the previous record: 241 metric tons of gold bought in the third quarter of 2018.
In spite of the robust gold demand, however, other analysts believe there is little chance gold could skyrocket to $4,000 per ounce.
Among them is Kenny Polcari, a Slatestone Wealth senior market strategist at Slatestone Wealth, who said he would like to see double gold prices, but doubted that could happen.
He stated the gold price would depend on how inflation is affected by interest rate spikes worldwide. That was why Polcari argued gold would see resistance if it reached $1,900 an ounce.
He agreed that gold would do better price-wise and praised it as an investment portfolio asset, but insisted it wouldn’t be “a $4,000 price target.”
As part of his analysis, Swiss Asia Capital CIA Kiener noted gold was increasingly leaving the West and going to Asia. China’s central bank bought gold worth $1.8 billion this month. As a result, its gold reserves have reached $112 billion.
Probably the most important graph from @CRutherglen's recent presentation:
When 2Y yield reverses, gold price in $ starts going up. This is also when DXY reverses.
All green for gold price to about 3k $/o it seems in 12-18 months.
It could be bumpy though… pic.twitter.com/DctKAVHwFC
— 471TO (@TOzgokmen) December 15, 2022